Real Estate | Home Sales

Home Buyer Guide – Purchasing a Fixer Upper

Reality TV shows and DIY shows have created an excitement and interest in purchasing a fixer upper home. What once was considered a poor home buying decision, is now viewed as a good investment. However, before you go purchasing your home you need to consider the risks you are taking with this type of home purchase.

Here’s a look at some of the risks that can come from purchasing a fixer upper home.

High Renovation Costs

Renovations and remodeling for a fixer upper can be extremely expensive. Most fixer uppers are older homes and the cost to renovate and remodel these types of homes can be through the roof.

Before you purchase a fixer upper make sure you consider the costs of the renovations and whether or not you will need a specialist to do the work or if you can do it yourself.

Underlying Problems

Many problems that the fixer upper has can be viewed from the outside. However, some of these problems can cause underlying problems that you cannot see.

Before purchasing a fixer upper home make sure you have a complete inspection of the home. A complete home inspection will allow you to get a better idea of all the problems and issues you are facing with this home purchase. Just remember a home inspection may not be able to find all the problems and you could encounter a laundry list of problems after you’ve purchased your fixer upper.

There are a lot of risks in purchasing a fixer upper. Just make sure you weigh them carefully before signing on the dotted line.

Filed Under: First Time Buyers/Renters, Real Estate Tagged With: Fixer-upper, Home inspection, Renovation

First Time Home Buyers Guide – FHA Loan Qualifications

Home ownership is something many people strive for but are unable to obtain because they have bad credit or are not able to meet the down payment requirements for many banks and financial institutes. The United States federal government helps many people every year become first time homeowners with the help of the Federal Housing Administration home loan program.

What is an FHA Loan?

A FHA loan is a loan that is provided by the Federal Housing Administration. The FHA will insure and backup the loan holder. This backing allows banks and financial institutes to offer you better rates because they have a place that can guarantee that they will receive payment if you default.

Who Qualifies for an FHA Loan?

The basic qualifications for an FHA loan is that the loan holder must have at least two years of steady employment history. The total household income should be steady or increasing over the past two to three years.

Credit history for an FHA loan is flexible allowing people with poor to okay credit to qualify. Credit history must include no more than two third day late payments in the past two years, and a credit score of 610 or higher.

There must also be two years between your loan application and your bankruptcy and foreclosures have to have happened and closed three years ago. However, with a foreclosure you are required to have perfect credit after that.

What is the Down Payment?

With an FHA loan the down payment can be as low as 3.5% of the asking price of the house. Closing and other costs can also be included in the loan.

Filed Under: Real Estate Tagged With: Federal Housing Administration, FHA insured loan, Mortgage loan

How to Buy a Fixer Upper House

Image by Will Spaetzel via Flickr

Times are tough, but along with tough times come opportunity. Home prices are lower than they’ve been in years, interest rates are low, and bank repossessions seem to be the rule rather the exception. You want to take advantage of that. What can you expect, and what should you watch for?

You may walk into a house the looks okay on the outside, but on the interior, resembles a war zone. Carpets may need to be yanked out, walls may need to be fixed, but if the “bones” of the house (meaning the foundation, electricity, and plumbing) check out by a reputable home inspector you may have yourself a candidate for a full remodel. If the house only needs an update, you’re in for a partial remodel. The money needed for the project can be provided through a payday cash advance.

Partial remodels are often taken on by first-time home buyers that can put their heads together for a basic clean-up. These individuals shouldn’t tackle the total remodel scenario until they’ve had some remodeling experience under their belts.

Analyze the repair costs. Sometimes these costs are offered as part of the mortgage, bringing your monthly mortgage cost up. At other times, you’re expected to foot the bill on your own. Check the location. Does it have potential for future resale value? Is it on a safe street? What about the neighboring homes? Are they kept up? Is the home a three bedroom, two bath property? Anything less will be more difficult for you to sell later—unless you’re adding an addition to the house or creating two rooms where there was one.

Filed Under: First Time Buyers/Renters, Real Estate Tagged With: House, Real estate pricing, Renovation

Determining the Best Time to Refinance Your Home Mortgage

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Many homeowners are in a situation where their home mortgage is more than the house is worth. This can make it difficult because you are paying more for a piece of property that is worth thousands of dollars less. If you found yourself in this type of situation there may be a solution that can help you out. Refinancing your home mortgage can help you get a lower interest rate and hopefully bring your mortgage down to an equal value of the home.

Before you refinance your home mortgage you need to determine if it is the best time to refinance and lock in a lower interest rate. Here’s a look at how you can determine if it is the best time to refinance your home mortgage.

Research Interest Rates

The first step to determine unit home mortgage needs to be refinanced is to research the various interest rates other banks are offering. If the interest rates are higher or similar to the rate you are paying you may want to consider reading to refinance your home. However, if interest rates are lower than what your pain you may want to consider locking in those rates.

Research Industry Trends

Many people make the mistake of refinancing their home mortgage and then a few months later interest rates drop dramatically. To avoid this make sure your research real estate and bank trends to determine if experts are expecting interest rates to raise or lower in the coming months.

Determining if it is the right time to refinance your home mortgage takes a little research but it can save you thousands of dollars in the long run.

Filed Under: Real Estate Tagged With: Interest rate, Mortgage loan, Refinancing

Different Paths to Your Dream Home

Each person’s vision of home ownership is unique, given the variety of homes available. At one extreme are cookie-cutter developments, where the same floor plan is multiplied, with cosmetic differences on the outside being the only distinguishing characteristics. On the other end are developers that offer so many choices of floor plans, amenities, and materials that each home becomes essentially custom-designed.

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If you are relocating, you may wish to consider renting for a time before tying yourself down to one neighborhood. If leasing means an extra move, getting moving quotes in advance is a good idea. Think of renting as an investment in time that will help you make a better purchase decision. Not being rushed has great value. Some first-time buyers are able to make offers on foreclosures, especially if they are pre-qualified for a mortgage loan. This is one way to get more house for your money than if you deal directly with a developer.

Another tactic is to purchase a home that is not in ideal condition, but has the potential to become your dream home. For example, a craftsman bungalow that can be restored to its original beauty on the outside, while getting an interior makeover to suit your family, might be a bargain. Look at plans and photographs for ideas. A skilled architect can create an addition to an existing home that is tastefully coordinated with the original. A tract home with sufficient yard space can become a showpiece simply by adding creative landscaping. Make a list of what matters to you, and keep updating it until you realize your dream.

Filed Under: Real Estate